So as I said in my remarks, there are multiple products at work here that are in a position to generate fee-related performance revenues over time.
Operator: We’ll go next to Brian McKenna with JMP Securities.
Brian Mckenna: So just following up on your comments on Asia, performance for your first BCP Asia fund has been strong with net return of 27%. And then it looks like the second fund is off to a strong start as well. So could you talk about what’s driving the healthy performance here? And then just in terms of building out your capabilities and scale in the region more broadly, I’m assuming you’ll look to do this organically, but would you ever look to strategic M&A to help accelerate growth here?
Jon Gray: So the real story for us in Asia has been India. Our team there has really delivered, particularly in private equity at Dixon and the team have delivered amongst our highest returns globally in India. And it’s represented, frankly, in real estate and private equity, about half of our Asia activities. And we had different weightings, I think, than others in the region, and that’s kind of turned out to be a very good decision. We’ve been a control-oriented investor in India, which we think is the right strategy. We’re also seeing very good opportunities in Japan today. That market is opening up to corporate selling off nonstrategic divisions we think we’ll see more volume there. And frankly, across the region, there is more opportunity.
China is a little more challenging, as you know, because of the economic headwinds and some of the geopolitical issues. But in general, Asia can grow to be much larger. We don’t really think we have the need to do an acquisition. We have 8-plus, I guess, offices across the region. I was there this quarter. Our momentum in places like Australia, Korea, really strong, and we think it’s a market that is underpenetrated as it relates to alternatives. And ultimately, we hope to have virtually all of our strategies in Asia at scale. So we have a sizable Asia private equity fund, sizable Asia real estate fund, we’ve got a core plus real estate fund in Asia, and we’re doing more on the credit side in that part of the world. Hopefully, we’ll add growth.
There are a lot of opportunities there given the scale of the place. Certainly, India, which has been our largest market, I think will continue to be a mainstay for us just given the incredible tailwinds that country has today.
Operator: We’ll go next to Brian — sorry, Mike Brown with KBW.
Mike Brown: So you’re 75% of the way through the $150 billion drawn on raising target, can you just touch on the key funds that will allow you to substantially achieve it by early 2024. And then outside of the drawdown fund, like in the wealth channel, how do you think about the growth opportunity in this channel over the coming years? And are you anticipating launching some new products into that channel, either later this year or next year?
Michael Chae: I’ll just start, Mike, on just on the path to 75% to substantially completing that by early next year. Obviously, some of the big funds we’re in the market with, but it’s BREP Europe, where we expect — we’ve had a first close, and we expect that to continue. BCP9,obviously, completing that over the coming quarters, our fifth real estate debt fund and a number of other funds. Next year will also be fundraising around our successor vehicles in life science and also in our GP Stakes fund. One thing I’d say as it relates to kind of financial impact we talked about sort of 75%. But importantly, less than half of the $150 billion flagship fundraise is currently earning management fees. And so because it obviously lags fundraise because based on deployment, you light funds later after you close them, and that percentage will accelerate over the coming quarters into 2024. So that’s sort of the picture on the path.
